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Driven by farmers' expectations of lower production
costs, higher yields, and reduced pesticide use, the
rate at which U.S. farmers adopt genetically engineered
(GE) crop varieties has jumped dramatically. It has
been estimated that about 220 million acres of GE
crops with herbicide tolerance and/or insect resistance
traits were cultivated worldwide in 2005, an 11-percent
increase over acreage in 2004, and U.S. acreage accounts
for about 55 percent of this. However, actual benefits
in terms of costs, yields, and pesticide use vary
with the crop and engineered trait.
Adoption of herbicide-tolerant (HT) crops, which carry
genes that allow them to survive certain herbicides
that previously would have destroyed the crop along
with the targeted weeds, has been particularly rapid
since they first became available to farmers in 1996
(see
detailed explanation and excel spreadsheets in the data
product, Adoption of Genetically
Engineered Crops in the U.S.). HT soybeans expanded
to 91 percent of U.S. soybean planted acreage and HT
cotton expanded to 70 percent of cotton acreage in
2007. Adoption of insect-resistant (Bt) crops, containing
the gene from a soil bacterium Bacillus thuringiensis
(Bt), has also expanded. Use of Bt cotton reached 59
percent of planted cotton acreage in 2007 and Bt corn
use grew from about 1 percent of corn acreage in 1996
to 49 percent in 2007.
Factors Affecting Farmers' Adoption of GE Crops
According to surveys conducted by USDA in 2001-03,
most farmers (59-79 percent) adopting GE corn, cotton,
and soybeans indicated that they did so mainly to "increase
yields through improved pest control." The
second most cited aim was to “save management time and
make other practices easier” (15 to 26 percent, except
for Bt corn, which was much lower); the third reason
was to "to decrease pesticide costs" (9-17
percent of adopters). All other reasons combined accounted
for 3-7 percent of adopters. Hence, factors expected
to increase economic profitability by increasing revenues
per acre (yield times price of the crop) or reducing
costs (operator labor, pesticides) are expected to promote
adoption most.
Effect of GE Crops on Yields
It is difficult to estimate the farm-level
effect of genetically engineered crops on yields because
impacts vary with the crop and technology examined. Yields
also depend on locational factors such as soil fertility,
rainfall, and temperature, which can also influence the
very presence of pests.
An additional problem with estimating the benefit of
GE crops is self-selection: farmers are not assigned randomly
to the two groups (adopters and nonadopters) but make
the adoption choice themselves. Therefore, adopters and
nonadopters may be systematically different and these
differences may manifest themselves in farm performance
and could be confounded with differences due purely to
adoption.
GE crops do not increase the yield potential of a hybrid.
In fact, yield may even decrease if the varieties used
to carry the herbicide-tolerant or insect-resistant genes
are not the highest yielding cultivars. However, by protecting
the plant from certain pests, GE crops can prevent yield
losses compared with non-GE hybrids, particularly when
infestation of susceptible pests occurs.
This effect is particularly important in the case of Bt crops.
Before the commercial introduction of Bt corn in 1996,
the European corn borer was only partially controlled
using chemical insecticides. The economics of chemical
use were not always favorable and timely application was
difficult. For these reasons, farmers often accepted yield
losses (of 3-6 percent per one corn borer per plant, depending
on the stage of plant development) rather than incur the
expense of chemical pesticides to treat the insect.
An ERS study estimated
the impact of adopting GE crops using 1997 survey data.
Herbicide-tolerant soybeans and cotton and Bt-enhanced
cotton were modeled individually. In each model, pest
infestation levels, other pest management practices, crop
rotations, tillage, and self-selection were controlled
for statistically. Geographic location was included as
a proxy for soil, climate, and agricultural practice differences
that might influence impacts of adoption.
Results of such modeling can be interpreted as an elasticity
or responsiveness to the change in a particular impact
(yields, pesticide use, or profits) relative to a small
change in adoption of the technology from current levels.
The results can be viewed in terms of aggregate impacts
across the entire agricultural sector as more producers
adopt the technology, or in terms of a typical farm as
they use the technology on more of their land. As with
most cases in economics, the elasticities estimated in
the quantitative model should only be used to examine
small changes (say, less than 10 percent) away from current
levels of adoption.
The study shows that adoption of herbicide-tolerant
cotton led to significant increases in yields. The elasticity
of yields with respect to the probability of adoption
of herbicide-tolerant cotton is +0.17. That is, an increase
of 10 percent in the adoption of herbicide-tolerant cotton
led to a 1.7-percent increase in yields. Similarly, the
adoption of Bt cotton in the Southeast increased yields
significantly (elasticity of yields is +0.21). On the
other hand, increases in adoption of herbicide-tolerant
soybeans led to small (but significant) increases in
yields (elasticity of yields is 0.03).
Effect of GE Crops on Pesticide Use
On the environmental side, pesticide use on corn and
soybeans has declined since the introduction of GE corn
and soybeans in 1996.
In addition, ERS research suggests that, controlling
for other factors, pesticide use declined with adoption.
The overall reduction in pesticide use associated with
the increased adoption of GE crops (Bt cotton; and HT
corn, cotton, and soybeans, using 1997/1998 data) also
resulted in a significant reduction in potential exposure
to pesticides. The decline in pesticide applications
was estimated to be 19.1 million acre-treatments (Fernandez-Cornejo
and McBride, 2002). Total pesticides
applied to corn, soybeans, and cotton declined by about
2.5 million pounds (active ingredients), despite the
(slight) net increase in the amount of herbicides applied
to soybeans.
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